Gresham Computing plc Acquisition of C24 Technologies Ltd

Posted: 4th October 2016 08:23

Gresham Computing plc, the leading software and services company that specialises in providing real-time transaction control and enterprise data integrity solutions, is pleased to announce that it has entered into a conditional share purchase agreement (the "SPA") with the C24 shareholders to acquire the entire issued share capital of C24 Technologies Ltd (the "Acquisition") for a total consideration of up to £4.55 million, comprising initial cash consideration of £3.41 million (the "Initial Consideration") and deferred cash consideration of up to £1.14 million (the "Deferred Consideration").

The Deferred Consideration will be paid in part at the first anniversary of completion (up to £0.76m) and in part following the date falling 18 months from completion (up to a further £0.38m) contingent upon certain transition related objectives and forecast customer contract renewals being achieved.

The Acquisition has a compelling strategic and financial rationale and will accelerate the Company's ambition to be the global category leader in enterprise data integrity solutions within financial markets.

Highlights of the Acquisition are set out below:

  • Expected to be earnings enhancing in the first full year and represents the first acquisition for the Company as part of its strategy for Clareti-led growth.
  • Doubles the Group's customer base by adding a further 35 recurring annuity-based customers in the Company's target financial services markets in the UK, Europe, North America and Japan.
  • Acquires proven technology that will enable the Group's flagship Clareti platform to connect to industry standard financial messaging networks thereby expanding the market opportunity for the Group's Clareti products.
  • Brings a development team with deep experience in real time data management solutions which will ensure continuity of support for C24 customers and adds capacity to accelerate the Group's development and innovation roadmap.
  • Acquires additional, as yet un-commercialised, intellectual property that complements the Group's fast data management development activities.

Gresham also announces that it proposes to raise approximately £3.32 million through a placing of new ordinary shares (the "Placing Shares") in the capital of the Company (the "Placing") as part of the funding of the Acquisition, with the balance of the Initial Consideration to be provided from existing cash resources and the Deferred Consideration being funded via C24's revenues.

The Placing is being conducted by way of an accelerated bookbuild (the "Bookbuild"), details of which will be announced separately and which will be launched immediately following that announcement. The Acquisition is conditional upon completion of the Placing and admission of the Placing Shares to trading. Nplus1 Singer Advisory LLP ("N+1 Singer") will be acting as sole bookrunner in connection with the Bookbuild.

Ian Manocha, CEO, commented:

"C24 Technologies are leaders in standards based financial messaging and integration solutions with a loyal global customer base. This acquisition supports the Group's strategic plan for Clareti-led growth, further builds our recurring revenue base, and will accelerate our innovation agenda."

Stephen Miller, Co-Founder of C24 Technologies, commented:

"In Gresham we have found a committed and experienced partner to support our global customers and realize our future C24 Data Platform vision. Gresham's Clareti platform is regarded as industry leading, and our technology and expertise will further strengthen its position and opportunity in the market."

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